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Mortgages, the basic principles !
As everyone should now be aware, mortgages are scarce and difficult to obtain unless you can meet certain very strict rules. To obtain the best rates, a borrower would be expected to put down as a deposit on a mortgage, or hold equity in the property if it's a re-mortgage, 25% of the property value. Note that value is what a surveyor would place on the property and not necessarily the value that the seller or owner thinks its worth.
Deposit requirements
Property Valuations
Credit History
Your Income
Mortgage Types
Cost of Mortgages
Interest Rates
Shared Equity
Equity Release
Your income will be a major factor in determining what a Lender will allow you to borrow. Rules vary from Lender to Lender but a good rule of thumb is to allow 4 times your income. However, it's really affordability that is the key so if you have fixed repayments to make on other debts, the amount of your income that will be taken into consideration for calculating the amount of loan you can get, will reduce.
As a borrower's situation moves away from ideal, Lenders will apply various penalties, usually on a sliding scale.
This could include, among others things:
Increasing their arrangement fees
Charging higher interest rates
Requiring you to provide additional proof of your circumstances
Rejecting your application
As a borrower's situation moves away from ideal, Lenders will apply various penalties, usually on a sliding scale.
This could include, among others things:
Increasing their arrangement fees
Charging higher interest rates
Requiring you to provide additional proof of your circumstances
Rejecting your application
Your credit history is currently of prime importance when applying for a mortgage and Lenders favour those with clean credit scores. When discussing your credit history with your mortgage adviser it is important to be entirely truthful as no matter how hard you try and hide a missed payment you can be sure it will come to light before any funds are released, causing potential disapointment and stress.
The value of property has been declining and is expected to decline further. Lenders being well aware of their value, ensure that surveyors make a proper assessment of the expected downside when they are placing their valuation for a mortgage, on a particular property. It's now very common for the assessed value of a property to be substantially below what an Estate Agent or seller might expect the value to be.
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Mortgage Principles
None of the information on this website is intended to promote any specific mortgage product or provide mortgage advice.
CharltonOnLine.com is a trading name of Charlton Marketing and Development Ltd.
CharltonOnLine.com is a trading name of Charlton Marketing and Development Ltd.
Your home may be re-possessed if you do not keep up repayments on your mortgage.
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Service
Email: charltonltd@charltonfs.com